Question:

In the classical theory, one of the following is an important assumption:

A.

Wages and prices are inflexible

B.

There is full employment

C.

Agents are price setters

D.

Adjustment is through quantity.

Answer» b. There is full employment

Question:

When Marginal Utility is negative, Total Utility:

A.

Declines

B.

Increases

C.

Remains the same

D.

None of these

Answer» a. Declines

Question:

Ordinal utility analysis is otherwise known as

A.

gossens second law

B.

cardinality approach

C.

indifference curve analysis

D.

rationality approach

Answer» c. indifference curve analysis

Question:

Utility is the concept which is:

A.

Objective

B.

Subjective

C.

Both

D.

None

Answer» b. Subjective

Question:

The factor earning of entrepreneur is:

A.

Rent

B.

Wage

C.

Interest

D.

Profit

Answer» d. Profit

Question:

In case of a convex indifference curve

A.

mrs xy is constant

B.

mrs xy is increasing

C.

mrs xy is negligible

D.

mrs xy is diminishing

Answer» d. mrs xy is diminishing

Question:

The Scarcity definition of Economics is the contribution of:

A.

Samuelson

B.

Adam Smith

C.

Lionel Robbins

D.

Marshall

Answer» c. Lionel Robbins

Question:

Which of the following equation is wrong?

A.

National Income = Effective demand

B.

National Income = GNP

C.

National Income = C + I

D.

National Income = C + S

Answer» a. National Income = Effective demand

Question:

Cardinal utility analysis to consumer equilibrium was developed by

A.

marshall

B.

hicks and allen

C.

geremy bentham

D.

gossen

Answer» a. marshall

Question:

As moving from left to right through an indifference curve, the MRS of X for Y

A.

Increases

B.

Remains the same

C.

Decreases

D.

Both A and C

Answer» c. Decreases